The government of Indonesia has been trying hard to control their coal output and export. The output is pushed down in order to preserve the coal for future generation. Government is also increasing domestic consumption following the electricity program of mega project 35,000 MW that more than 50% of the electricity production is made from coal-fueled power plant. Yet, regardless of the control, coal output and export is on the rise in 2017, due to higher prices and demands from global worlds.
In 2017, coal production is calculated to be about 18% higher than government mandated target of 413 million metric tons. As the coal prices recovered from a five-year collapse, miners maximize their output to take the advantages and compensate the previous losses. In addition, Indonesian coal is in high demand by many countries in the world.
The biggest customers of Indonesian coal are China, India, South Korea, and Japan. Although export to China is shrinking over the pass three years due to the rise of China’s domestic output, Chine is still one of the top of Indonesia’s overseas shipments. From January to August 2017, it is recorded the value of Indonesia’s coal export to China reached USD 1.68 billion. Indonesia is on the second place of China’s coal partners under Australia who take the first place.
India is also potential market for Indonesia’s coal. In 2015, export to India is recorded to be 34% of the total Indonesia’s coal export. The number rose greatly from 28% in 2013. India is on the great development that requires energy while coal is low cost resources to meet their energy demand.
Apart of the four countries, demands are also coming from other countries. The neighboring countries such as Malaysia, Vietnam, and Philippines are small examples of the countries that make market diversification wider.
Demand from Malaysia is high. The record stated 10 million tons of coal is imported by Malaysia from Indonesia in 2017. Malaysia needs coal because about 45% of their energy supply comes from coal-fueled power plant. The great development in some regions makes the energy demand rise, hence coal demand in increase. It is predicted that Malaysia will need 40 millions tons of coal annually by 2020. Importing coal from Indonesia is so far the best solution for Malaysia since the country does not have enough coal output.
Vietnam is also highly needs coal for their energy production. Coal is low cost hence it is suitable for developing country like Vietnam. Due to lack of coal reserves, Vietnam could not fulfill their need of coal themselves. Import becomes their solution, while Indonesia is their best choice.
Philippines is another potential market for Indonesia’s coal. The estimation is about 15 million tons of coal is shipped from Indonesia to Philippines every year. Indonesia is the highest coal supplier for Philippines as 70% of their coal import comes from Indonesia. Unfortunately, coal trade between two countries was disturbed by a series of hijacking incident in Philippines southern sea in 2016. The governments of two countries are working hard to solve the problem.
There are many other countries, which need coals for their energy. Even countries who try to convert their energy production into more environmental-friendly still need coal to meet their increasing energy demands. For example is Sri Lanka. The country works hard to convert their electricity production to solar energy. However, they still import coal to generate energy for industry.
Indonesia still takes the top place of thermal coal exporter. Known as low-grade coal, demand to Indonesia’s coal is high due to the low cost. Therefore, coal sector is said to be one of the promising investments in the country.
Indonesia is part of Top 10 coal producers worldwide
Coal is the key to the worldwide structure of energy. It accounts for about 40% of the world’s electricity production, hence it is a leading source of electricity. It will soon replace oil and become the largest source of primary energy. Coal dominates the global energy arena due to its abundance, affordability and wide distribution across the world. Coal reserves are estimated at 869 billion tons based on the current production rate. This means that coal should last about 115 years longer compared to the conventional reserves of oil and gas. Especially noteworthy are the significant coal reserves in Asia and southern Africa, two areas of the world that face major challenges in supplying energy to their populations. Coal reserves are highly underestimated in comparison with conventional reserves of oil and gas.
The ten leading countries based on hard coal production
China is the chief coal producer while the United States comes in second. Other major coal producers are India and Australia. Five countries, namely China, the United States, Russia, India and Japan accounted for over 75% of worldwide coal consumption. Despite the swift deployment of renewable energy, mainly in the background of debates around climate change, it is coal that is responsible for the largest upsurge in energy requirement of all energy sources.
Approximately 90% of the total global coal is produced by ten countries with China running in the lead. The statistics below show countries that have substantial coal resources. The data has been based on a wide assortment of material, as well as data acquired from the World Energy Council and both national and international publications.
Coal production in Ukraine in 2013 was about 64.976 Million tons. With the ongoing conflict in the country, there has been a decline in coking coal production and in coal power generation, particularly in the affected eastern regions of the country. Indeed, the Donetsk region has experienced a fall of nearly 30% in coal production. As a result, Ukraine has started importing coal from South Africa and Russia for the purpose of power generation.
Colombia’s coal production was around 85.5 million tons in 2013, an output which represented a 4% drop off from its target of 89 Million tons. Coal exports were estimated at 94.3%. The country’s National Mining Agency reported an increase of 18% in mineral production.
Kazakhstan stands in eighth with a coal production of 116.6 million tons as of December 2012. Regarding consumption, Kazakhstan came in 12th, with coal accounting for nearly 85% of the nation’s entire connected power capacity. The country has an estimated reserve of about 33.6 billion tons and thus holds the eighth largest coal reserve. Kazakhstan has over 400 coal mines.
With about 260 million tons produced, South Africa comes in seventh in global coal production. The country is the sixth largest coal exporter, having traded about 74 million tons in 2012. South Africa mostly exports its coal to Europe, China, and India. It is estimated that over 90% of electricity production in South Africa depends on coal. South Africa’s established coal reserves had about 30.15 billion tons in
Russia comes in sixth regarding worldwide coal production. It produced 354.8 million tons of coal in 2012, of which 80% was steam coal and the rest coking coal. Russia is also the fifth largest consumer of coal. It exported 134 million tons in 2012, becoming the third largest coal exporter. With reserves of up to 157 billion tons, Russia is second in the world as pertains coal reserves. Open pit mining accounts for more than half of Russia’s coal production.
Indonesia comes fifth in coal production, having produced 386 million tons of coal. Indonesia and Australia have been head to head in coal production, and while in 2011 Indonesia overtook Australia in coal production by now the situation has been reversed. Coal is responsible for 44% of Indonesian electricity production. The country has about 5.5 billion tons of coal reserves based on 2012 statistics.
Coal output in Australia reached 413 million tons in 2013, positioning it at number four in the world. The country exports about 90% of its coal, coming in second after Indonesia, and in 2012 it exported 384 million tons. Australia otherwise maintains 76.4 billion tons in its reserves. The country has about 100 private coal miners carrying out open pit operations, and this method of mining accounts for 74% of Australia’s total coal production.
India’s coal production was about 605 million tons, making it the third largest producer globally. India consumed 8% of the total world?s coal, making it the third largest consumer of the resource as well. It is also the third largest importer of coal with a total of 160 million tons in imports, trailing behind China and Japan. Around three-quarters (68%) of electricity generation in India depends on coal. The verified coal reserves in India are estimated at 60.6 billion tons as of 2013, ranking again as number three globally.
2.THE UNITED STATES
The United States is second worldwide in coal production, generating 922 Million tons of coal in the 2012/2013 period representing approximately 13% of global coal production. It is also the second biggest coal consumer. US consumption of coal is estimated at 11% of the world’s total usage, and nearly 37% of the nation’s electricity production depends on coal. The US also has the world’s largest coal reserves, measuring in at approximately 237 billion tons.
China has been the biggest coal producer in the past three decades. China produced nearly 3.7 billion tons of coal in 2013 representing 47% of global total coal yield. The country also consumes more than half of the world’s total coal consumption. China is the third worldwide as relates to coal reserves, with an estimate of 114.5 billion tons per December 2012 statistics. It is estimated that China uses half of its coal for power generation, which accounts for over 80% of the country’s electricity production.
Coal is proving critical in the world’s energy growth. The need for coal is ever increasing, and ever larger percentages of electricity produced in the world is becoming reliant on power plants that use the resource. Regardless of the enormous distribution of coal reserves worldwide, these amounts are proving to not be enough. Furthermore, the ecological harms that come as a result of activities related to coal activities are grave matters and, thus, proper actions have to be taken. Consequently, it is essential for governments to discover innovative technologies for improved mining and coal processing, while also taking into account efficiency and the importance of environmental sustainability. It is paramount for policy makers come up with long-lasting technological solutions that look into future, hence putting the coal sector on a path that would allow it to respond better to future global challenges.